CHAPTER FIVE:
Architectures- types
•IT architecture: a general plan of how IT is to be used by/within an organisation – useful for planning. Identifies where and how important information, such as customer records, is maintained and secured.
•Good information architectures include
· –A strong information security plan
· –Managing user access
· –Up-to-date antivirus software and patches
•IT infrastructure: Is the actual implementation that will provide for effective Information Systems, including the hardware, software, services and people involved.
Includes the hardware, software, and telecommunications equipment that, when combined, provides the underlying foundation to support the organisation’s goals – this must be dynamic as it will change as the organisation changes.
Infrastructures- characteristics of a good information infrastructure (reliability, scalability, capacity, flexibility, security):
Application architecture: determines how applications integrate and relate to each other
With new architectures, IT can build new business capabilities faster, cheaper, and in a vocabulary the business can understand
Web services have become a major avenue for this integration
Open systems and source code rather than proprietary systems and source code
Service orientated architecture, basic concept of an event and service
Service oriented architecture (SOA) is a business-driven IT architectural approach that supports integrating a business as linked, repeatable tasks or services
SOA ensures IT systems can adapt quickly, easily, and economically to support rapidly changing business needs
Using meta data and existing applications, users can re-use applications (services) many times for different tasks, making development cheaper and more flexible
SOA LAYERS:
The two primary parts of web services are:
1.Event – is an electronic message indicating that something has happened, it detect threats and opportunities and alerts those who can act on the information
2.Service – contains a set of related commands that can be re-used, it is more like a software product than they are a coding project
•Need to be reusable if they are going to have an impact on productivity
CHAPTER SIX:
What is a database?
A database is the heart of an organisation; it stores key business information like;
· —Sales Data – customers, sales, contacts
· —Inventory Data – orders, stock, delivery
· —Student Data – names, addresses, grades
All businesses use a database of some type. Effective managers know the value of extracting of important data.
Database
· Organized collection of data
Database management system (DBMS)
· Group of programs that manipulate the database
· Provide an interface between the database and its users and other application programs
Database administrator (DBA)
· Skilled IS professional who directs all activities related to an organization’s database
DB's ensure that...
—Data security: Keeping the organization’s data safe from theft, modification, and/or destruction.
—Data integrity: Data must meet constraints (e.g., student grade point averages cannot be negative).
—Data independence: Applications and data are independent of one another. Applications and data are not linked to each other, meaning that applications are able to access the same data.
Difference between a database and plain file storage…
File approach:
Database approach:
Pool of related data is shared by multiple application programs.
— Database management system (DBMS) provides all users with access to all the data.
Table
—A set of related records 
Record
A collection of data about an individual item 
Field
A single item of data common to all records 
What is the main concept being behind a relational database?
—A relational database is a collection of tables from which data can be accessed in many different ways without having to reorganize the database tables.
—That is, once relationships are created, tables can “talk” to each other. We can link (relate) the tables to find:
—Which doctors are seeing a patient
—Which students are in which class
—Which item is selling the most on Friday’s
What were some problems faced prior to databases (file approach, data isolation, and data redundancy)
DBMSs minimize the following problems:
—Data redundancy: The same data are stored in many places.
— Data isolation: Applications cannot access data associated with other applications.
—Data inconsistency: Various copies of the data do not agree.
Analytical vs transactional data
Chapter 8- Ops Mgt
What is ops mgt?
Operations management (OM) - the management of systems or processes that convert or transform resources into goods and services
} Transformation process - the actual conversion of inputs to outputs
} Information Technology is used in OM to identify and improve business processes. It aims to automate processes where possible
Managers use IT to heavily influence OM decisions, including:
What: What resources will be needed and in what amounts?
When: When should the work be scheduled?
Where: Where will the work be performed?
How: How will the work be done?
Who: Who will perform the work?
Operations Management
Decreases in the cost of goods sold can lead to significant profit increases
Operations Manager must manage;
· Effective supplier relations
· Inventories
· Operations planning and control
· On time delivery, quality, and customer satisfaction
· Procurement, production operations, employee productivity, and ultimately profitability & cash Flows
To be effective, the Operations Manager must have must have access to real-time, accurate data to support their decisions.
Traditional Problems faced by OMs
· Many small standalone systems make it difficult to keep pace with changing demands
· Disparate systems in different business units hamper the flow of information and material between operations, often times inflating costs and inventories
· Aging and inconsistent technology platforms lead to increasing IT maintenance and support costs
· Recurring, manual tasks
· Too many versions of the truth increase the risk of poor decisions due to inaccurate data
IT role in Ops Mgt provides visibility over many aspects of the business
Challenges and benefits to implementing Ops Mgt Systems
· Operations Management Systems
· An integrated system is the only way to have a consistent view of the data and provide up to the minute results—on a company-wide basis.
· By automating the most important business practices, business will be able to work more efficiently, reduce overhead, increase agility, and improve insight into business processes
Challenges to Implementing OM Systems
· Organizations have saved millions of dollars by replacing
· outdated technology and paper-based systems, and
· integrating previously disparate systems to eliminate
· Duplication of effort and increase consistency of information. However, this has been difficult due to;
Low adoption rates – employees won’t learn new processes as they see them as too complex
Incomplete adoption – employees only use few features of the new system and stick to what they know
Long training periods – complex systems take a long time to learn and even longer to master. This can result in expert employees constantly helping other employees and not doing their own jobs properly
Generic approach - companies frequently need to significantly modify their systems to address the unique needs of an organization, such as industry specific business processes
Supply Chain Mgt
What is supply chain?
A supply chain is a network of organizations and facilities that transforms raw materials into products delivered to customers.
Customers order from retailers, who in turn order from distributors, who in turn order from manufacturers, who in turn order from suppliers.
The supply chain also includes transportation companies, warehouses, and inventories and some means for transmitting messages and information among the organizations involved.
Supply Chain Management (SCM) – involves the management of information flows between and among stages in a supply chain to maximise total supply chain effectiveness and profitability
What are the components of the supply chain?
A supply chain involves three segments:
Upstream, where sourcing or procurement from external suppliers occurs.
Internal, where packaging, assembly or manufacturing takes place.
Downstream, where distribution takes place, frequently by external distributors.
Tiers of suppliers, a supplier may have one or more subsuppliers, and the subsupplier may have its own subsupplier(s) and so on.
Generic Supply Chain:
How does IT assist in supply chain mgt?
Technology advances in the five SRM components have significantly improved companies’ forecasting and business operations
Integrated Systems provide companies with greater visibility over the supply chain inventory levels
IT’s primary role is to create integrations or tight process and information linkages between functions within an organisation
Complexity, inventory mgt, supply, management of flows along the supply chain
Effective Supply Chain Management
· Decrease the power of its buyers
· Increase its on supplier power
· Increase switching costs to reduce the threat of substitute products or services
· Create entry barriers thereby reducing the threat of new entrants
· Increase efficiencies while seeking a competitive advantage through cost leadership
· Material flows are the physical products, raw materials, supplies and so forth that flow along the chain.
· Information flows are all data related to demand, shipments, orders, returns and schedules as well as changes in any of these data.
· Financial flows are all transfers of money, payments and credit-related data.
· A supply chain involves a product life cycle approach, from “dirt to dust”.
One phenomenon common to supply is the bullwhip effect - where variability in the size and timing of orders increase at each stage up the supply chain, from customer to supplier.
The bullwhip effect is a natural dynamic that occurs because of the multistage nature of the supply chain.
It is not related to erratic consumer demand.
Common inventory issues:
· Lots of “dead” inventory in the warehouse. (not saleable)
· Too much of the wrong stock and not enough of the stock required to meet current demands
· Frequent stock outs and back orders of popular products.
· Delays in filling and shipping orders to customers
· This results in inefficient use of warehouse space
· Lost money that could be used for other opportunities
· Increase labour costs as inventory not organised
Dead Stock is inventory that cannot be sold in a reasonable amount of time. Dead stock might be caused by;
· Leftover quantities of special order items
· Customer-specific inventory remains after customer no longer buys that item
· Leftover quantities of obsolete products
· Changes in demand at various stage in the supply chain
Chapter 9- CRM & BI
Customer relationship management (CRM) – involves managing all aspects of a customer’s relationship with an organisation to increase customer loyalty and retention and an organisation's profitability
CRM helps companies make the their interactions with customers seem friendlier through individualization
aim to...
· provide better customer service
· make call centres more efficient
· cross sell products more effectively
· help sales staff close deals faster
· simplify marketing and sales processes
· discover new customers
· increase customer revenues
Software that manages the relationship with customers includes;
· ◦Customer contacts
· ◦Customer Service
· ◦Sales tracking
· ◦Lead Management
· ◦Targeted marketed
· ◦campaigns
· ◦Financial forecasting
· ◦Customer Analysis – demographics, trends and behaviour
Includes a one-to-one relationship between a customer and a seller.
One simple idea “Treat different customers differently.”
Helps keep profitable customers and maximizes lifetime revenue from them.
Need for CRM
—It costs six times more to sell to a new customer than to sell to an existing one.
—A typical dissatisfied customer will tell 8-10 people.
—By increasing the customer retention rate by 5%, profits could increase by 85%.
—Odds of selling to new customers = 15%, compared to the odds of selling to existing customers (50%)
—70% of complaining customers will remain loyal if problem is solved
Operational vs Analytical CRM systems
—Operational CRM
Supports traditional transactional processing for day-to-day front-office operations or systems that deal directly with the customers
Focuses on organising and simplifying the management of customer information. It uses a database to provide consistent information about a company’s interaction with a customer
Three marketing operational CRM technologies:
1. List generator – compiles customer information from a variety of sources and segment the information for different marketing campaigns
2. Campaign management system – guides users through marketing campaigns
3. Cross-selling and up-selling
-Cross-selling – selling additional products or services
-Up-selling – increasing the value of the sale
—Three customer service operational CRM technologies:
1. Contact/call centre
· •Automatic call distribution
· •Interactive voice response
· •Predictive dialing
· •Emotion detection
2. Web-based self-service system
Click-to-talk
3. Call scripting system
Using CRM metrics to track and monitor performance is a best practice for many companies, to understand if its CRM practices are adding to its success
CRM metrics include:
· Sales metrics
· Service metrics
· Marketing metrics
Sales Metrics:
· Number of prospective customers
· Number of new customers
· Number of retained customers
· Number of open leads
· Number of sales calls
· Amount of new revenue
· Amount of recurring revenue
· Number of proposals given
Service Metrics:
· Cases closed same day
· Number of cases handled by agent
· Number of service calls
· Average number of service requests by type
· Average time to resolution
· Average number of service calls per day
Marketing Metrics:
· Number of marketing campaigns
· New customer retention rates
· Number of responses by marketing campaign
· Number of purchases by marketing campaign
· Revenue generated by marketing campaign
· Customer retention rate
Analytical CRM
Supports back-office operations and strategic analysis and includes all systems that do not deal directly with the customers
Analytical CRM uses data mining to provide strategic data about customers. Data mining uses various modelling and analysis techniques to find patterns and relationships to make accurate predictions
Predictions might include;
· Which customers to market to
· Up selling / Cross selling
· Retaining good customers
The customer life cycle has three main phases:
· Acquiring Customers
· Increasing the value of the customer
· Retaining good customers
Analytical CRM data can help at each stage
By using analytical CRM data, companies can be more accurate in the ways they obtain new customers.
For instance, a bank may have traditionally emailed 1 million customers with a credit card offer at $1 per mailout. They may get 60 000 responses, with only 10 000 serious customers.
By applying data mining models, they may only need to target 250 000 customers. A clear saving in marketing costs.
Cross Selling – using analytical CRM data an organisation can predict where cross selling will be effective. Cross selling is offering customers information about other complimentary products.
Up selling- this involves using data to look at buying patterns of customers and knowing when to offer more product. The CRM could show times when customers are likely to buy more product, could be seasonal or related to an event.
Acquiring new customers exceeds the cost of retaining existing customers. Good customers are those that are profitable or have ‘lifetime’ value. By using analytical CRM’s to profile good and bad customers, more effort can be spent keeping good customers.
For instance, a mobile phone provider with 1’000’000 customer that loses 80’000 customers per month, needs to spend $200 to find each new customer, or $16, 000, 000. By predicting who might leave and providing them with incentives like better plans or free phones, they can make significant savings.
Using IT to drive Analytical CRM
Explore customer behaviour
Develop a personal customer profile– when a web site knows enough about a person’s likes and dislikes that it can fashion offers that are more likely to appeal to that person (personalisation)
Analytical CRM relies heavily on data warehousing technologies and business intelligence to glean insights into customer behaviour
These systems quickly aggregate, analyse, and disseminate customer information throughout an organisation
Analytical CRM information examples:
1. Give customers more of what they want
2. Value their time
3. Over-deliver
4. Contact frequently
5. Generate a trustworthy mailing list
6. Follow up
Data-mining
Business intelligence (BI) – applications and technologies used to gather, provide access to, and analyse data and information to support decision-making efforts.
Data mining is the application of statistical techniques to find patterns and relationships among data and to classify and predict.
Data mining represents a convergence of disciplines
Data-mining techniques emerged from statistics and mathematics and from artificial intelligence and machine-learning fields in computer science.
Common forms of data-mining analysis capabilities include:
· Cluster analysis
· Association detection
· Statistical analysis
What are the triple constraints, how do they affect project management?
The triple constraint involves making tradeoffs between scope, time and cost for a project. It is inevitable in a project life cycle that there will be changes to the scope, time or cost of the project.
Failing to Plan, is Planning to Fail
There is a high failure rate in IT projects between 30 to 70 per cent due to late delivery, exceeding budget, or not delivering what was agreed upon
Increased Scope = increased time + increased cost
Tight Time = increased costs + reduced scope
Tight Budget = increased time + reduced scope.
-Strategic projects- in line with org strategy
Project – temporary endeavour undertaken to create a unique product, service, or result
Project management – the application of knowledge, skills, tools, and techniques to project activities to meet project requirements, it implies;
· a specific timeframe
· a budget
· unique specifications
· working across organizational boundaries
The Project Management Institute (PMI) develops procedures and concepts necessary to support the profession of project management (www.pmi.org) and has three areas of focus:
1. The distinguishing characteristics of a practicing professional (ethics)
2. The content and structure of the profession’s body of knowledge (standards)
3. Recognition of professional attainment (accreditation
Key documents- charter/plan
Project charter - a document issued by the project initiator or sponsor that formally authorises the existence of a project and provides the project manager with the authority to apply organisational resources to project activities. This includes:
· Project scope
· Project objectives
· Project constraints
· Projects assumptions
What must be done?
What are the required resources?
What are the constraints?
What are the short and long term implications?
Why do it?
When must it be done?
Where must it be done?
Who does what?
Who is behind the project?
Who is funding the project?
Who is performing the work of the project?
SMART criteria are useful reminders on how to ensure that the project has created understandable and measurable objectives
Project plan – a formal, approved document that manages and controls project execution
A well-defined project plan should be:
— Easy to understand and read
— Communicated to all key participants
— Appropriate to the project’s size, complexity, and criticality
— Prepared by the team, rather than by the individual project manager
What tools do project manager’s use?
— Many tools available
¡ Microsoft Project
¡ Many more specialized software
¡ Various online tools – (SaaS PM)
¡ Excel
— Most important
¡ Monitor tasks
¡ Gantt views of project
÷ Executive summary
÷ rollout and more complex views for work teams
¡ Critical Paths
¡ Inputs from multiple teams that roll up to project manager
¡ Dependencies
Two primary diagrams used in project planning include PERT and Gantt charts
•PERT chart – a graphical network model that depicts a project’s tasks and the relationships between those tasks
•Gantt chart – a simple bar chart that depicts project tasks against a calendar
Skills of a project manager-
Project manager - an individual who is an expert in project planning and management, defines and develops the project plan, and tracks the plan to ensure the projects is completed on time and on budget
Managing a project includes:
— Identifying requirements
— Establishing clear and achievable objectives
— Balancing the competing demands of quality, scope, time, and cost
— Adapting the specifications, plans, and approach to the different concerns and expectations of the various stakeholders
A project manager must focus on managing three primary areas to ensure success:
— Managing people
— Managing communications
— Managing change
Three important guidelines for effectively dealing with change management:
1. Institute change management polices
2. Anticipate change
3. Seek change
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